The Ninth Circuit released its decision in Lenz v. Universal this morning — the case about the baby dancing in his kitchen to Prince’s “Let’s Go Crazy.” It’s a ruling that gives a lot of gifts all around.

Fair use is an authorized use, not an affirmative defense

The main takeaway is the court’s holding that fair use is a right granted by the Copyright Act, and is wholly authorized by the law. It is not an affirmative defense to infringement, despite often being labeled as such for procedural reasons (“That fair use may be labeled as an affirmative defense due to the procedural posture of the case is no different than labeling a license as an affirmative defense for the same reason.”) It is, the court said, a mistake to conflate it with those affirmative defenses that excuse impermissible conduct; fair use is a wholly authorized and lawful use. Therefore, for purposes of the DMCA, a copyright holder must consider fair use before sending a DMCA takedown notice.

What does that mean to you?

If you’re sending DMCA takedown notices, you need to consider whether or not the stuff you’re complaining about is actually being used perfectly legally. It’s legal to use copyright-protected content for things like criticism, parody, or for transformative purposes (where the original work has been substantially changed in a way that adds new expression or meaning). This can be hard to figure out — seriously, even copyright attorneys can’t ever agree on fair use — but the important thing here is that you ask yourself the question: is this actually infringing or is it being used legally?

If you’re receiving a DMCA takedown notice, you need to ask yourself the question as well: was my use fair, or was it actually infringing? If you’re just posting a song on YouTube because the song wasn’t already on YouTube and you wanted to share it, sorry, you’re infringing. Think about that before you send a counternotice.

Subjective good faith belief

Because Universal failed to consider fair use before sending its takedown notice, the court held to the Rossi standard and imposed a subjective good faith belief standard in considering whether or not it knowingly misrepresented (for §512(f) purposes) that it had formed a good faith belief that Lenz’s video did not constitute fair use. In Rossi, the court held that “[a] copyright owner cannot be liable simply because an unknowing mistake is made, even if the copyright owner acted unreasonably in making the mistake. Rather, there must be a demonstration of some actual knowledge of misrepresentation on the part of the copyright owner.” The court reaffirmed this holding, saying:

“To be clear, if a copyright holder ignores or neglects our unequivocal holding that it must consider fair use before sending a takedown notification, it is liable for damages under § 512(f). If, however, a copyright holder forms a subjective good faith belief the allegedly infringing material does not constitute fair use, we are in no position to dispute the copyright holder’s belief even if we would have reached the opposite conclusion. A copyright holder who pays lip service to the consideration of fair use by claiming it formed a good faith belief when there is evidence to the contrary is still subject to § 512(f) liability.”

What does that mean to you?

Believe it or not, this is the important stuff, when you sort through the legalese. This means that all you have to do is try.

If you don’t try at all to consider fair use, you’re violating the law.

If you say you considered fair use and formed a good faith belief, but all the evidence shows you totally ignored fair use, you’re violating the law.

But if you consider fair use, reasonably and in good faith, you’re safe. Even if your decision was wrong. Even if you thought something wasn’t fair use and some court later decides it actually was. As long as you can show you tried, you’re fine.

Automated DMCA takedowns can still consider fair use

The court didn’t leave copyright holders totally exposed, and in fact, did not demand human review of all content before sending DMCA takedowns. It discussed the implementation of computer algorithms as a “good faith middle ground for processing a plethora of content while still meeting the DMCA’s requirements to somehow consider fair use.” It set out guidelines for sufficient consideration of fair use in automated takedown programs, such as where

“the video track matches the video track of a copyrighted work submitted by a content owner;

the audio track matches the audio track of that same copyrighted work; and

nearly the entirety . . . is comprised of a single copyrighted work.” *

What does this mean to you?

If you’re using a system for automated DMCA takedowns, you now have a very clear guide for how it should be configured. Content that would not be caught by this system should still involve human review.

If you’re not using a system for automated DMCA takedowns, this part doesn’t affect you much, but you can still use it as a good guideline for what kinds of takedowns the court considers less likely involve fair use.

Actual losses not necessary for §512(f)

Finally, the court holds that 512(f) does not require a plaintiff to show that she has suffered any actual monetary losses before she can recover damages. In short, the court describes the DMCA as “a statutorily created intentional tort whereby an individual may recover nominal damages for a knowingly material misrepresent[ation] under this section [512].” Therefore, 512(f) plaintiff may seek any damages suffered as a result of the misrepresentation.

What does this mean to you?

This part, along with one other, has gone back to the district court. We’ll have to see how it ends up in reality. However, in theory, this means that a plaintiff suing for a wrongful takedown could recover damages including attorneys’ fees, even if the plaintiff hasn’t actually suffered any losses (Stephanie Lenz is represented by pro bono counsel who is only paid if she recovers attorneys’ fees).

This is important because of how rarely §512(f) is used. Section 512(f) is really the only thing in the DMCA that polices fraudulent or inappropriate use of DMCA takedowns, and it needs to have some teeth without being so dangerous that content creators are too afraid to file legitimate DMCAs. All users should care about how this one comes out, because the balance here needs to be delicate.

* Interestingly, these limits come from fair use principles the EFF proposed back in 2007, in response to efforts by a large group of commercial copyright owners to create guidelines for online service providers that host user generated content (UGC). The UGC Principles proposed by the group of copyright owners were complex, confusing, difficult for online providers to implement (they required the use of identification technology such as ContentID), and they gave no consideration of fair use. Ultimately, they were largely ignored by service providers who were not original signatories of the UGC Principles. By contrast, the EFF Fair Use Principles are simple, clear, and while they are not perfect (for instance, they would still permit the wrongful takedown of a licensed work), the court agreed that they do offer a “good faith middle ground.”

Oh, come on, I had to. I’ve wanted to use that in a blog post title for ages.

Last month, I talked about the mess Goldieblox and the Beastie Boys had gotten themselves into. A quick recap: Goldieblox made an ad on YouTube parodying one of the Beastie Boys’ songs, and it went viral. The Beastie Boys don’t let their songs be used in advertising. Much finger-pointing ensued, and Goldieblox sued the Beasties for declaratory judgment before putting up a CAN’T WE ALL JUST GET ALONG post. And then things went sort of quiet, while the internet sorted itself into Team Goldieblox, Team Beastie Boys, and Team Who The Hell Cares.

And then…

Last week, the Beastie Boys countersued Goldieblox. The counter-complaint (it’s a counter-complaint because Goldieblox sued first by asking the court for declaratory judgment, and the Beastie Boys had never gotten to make a complaint in the first place) is an arsenal: it’s not just copyright infringement but also trademark infringement, false advertisement, false endorsement. unfair competition, and misappropriation of right of publicity. They’ve thrown everything they could at Goldieblox. And interestingly, they’ve asked for the profits Goldieblox has made from the video.

Okay, that’s a lot to unpack. Let’s start with the doubletake:

Why are the Beastie Boys still so mad?

Goldieblox tried to make nice, right? Well…yes and no. Sure, Goldieblox put up a white flag blog post. But it never ended its lawsuit against the Beastie Boys. So Goldieblox was effectively standing there with one hand offering a handshake and the other holding a loaded gun.

And this was after Goldieblox had made similar videos rewriting Queen’s “We Are The Champions,” for which they never got licensing rights either, as well as videos using songs by Daft Punk, Kaskade, and other artists. These videos have now been pulled or made private, as has “I Want A Goat,” a similar video Goldieblox’s CEO and founder made for a fundraising campaign in India, for which she and her husband rewrote the lyrics to Lonely Island’s “I’m On A Boat” (presumably without getting the licensing rights). As the Beastie Boys say in their counter-complaint, “unfortunately, rather than developing an original advertising campaign to inspire its customers to create and innovate, GoldieBlox has instead developed an advertising campaign that condones and encourages stealing from others.”

Most importantly, though, it’s an ad, and it isn’t just any ad. It’s an ad that Goldieblox has submitted to a contest Intuit is hosting that will allow a small business to air a commercial during the Super Bowl, and Goldieblox’s ad is one of the four finalists. Goldieblox never withdrew the ad from the contest, and it is still eligible for the Super Bowl spot. While this is not mentioned in the prayer for declaratory judgment and is only briefly touched on in the counterclaim, I believe it is the crux of why the Beastie Boys went after Goldieblox as hard as they did. If that commercial airs during the biggest advertising day of the year, it not only stands to give Goldieblox some great advertising, but it potentially harms the Beastie Boys’ effort to keep their music from being associated with commercials and their names from being associated with advertising.

But it’s fair use, right?

Maybe. Probably. I think Goldieblox has a very good fair use argument. But nothing is ever 100% fair use until a judge says it is.

It may be an outdated exaggeration to say, as Larry Lessig does, that “Fair use is the right to hire a lawyer,” but to an extent it’s true: while we have a good deal of strong case law and precedent that gives us guidelines, ultimately fair use is what a court says it is. In this case, as I discussed in my last post, it is entirely possible for commercial use, even an advertisement, to also be fair use. However, the use of a work, even the parody of a work, in an advertisement weighs against a finding of fair use, but it’s only one thing to consider.

It’s worth discussing Goldieblox and parody, though. There’s a difference between parody and satire. A parody is a work that imitates another work in order to poke fun at or comment on something about the work itself. A satire is a work that pokes fun at or comments on something external to the work: the world in general, cultural issues, political issues, and so forth. The “Girls” video is a parody because the original song was misogynistic, and the Goldieblox video sings about empowering young girls. It comments on the work itself. However, looking at it in the context of Goldieblox’s larger campaign of taking songs from popular musicians and making funny, cute, derivative songs from them — such as turning “I’m On A Boat” into “I Want A Goat” — it begins to look less like an insightful commentary and more like coincidence. “I Want A Goat” does not comment on the message of “I’m On A Boat.” It just happens to fit the rhyme scheme. Still parody, but not a particularly inspiring one.

Okay, what about those damages? What profits? It’s YouTube!

Now that’s an interesting issue. How do you value damages for copyright infringement on social media? Shameless plug: I have some friends working on a really awesome article on that, coming out in a few months. In the meantime, we can always just speculate.

It’s a YouTube video, sure. But it’s also an ad, and it has an associated product. That product is now in the top 25 on Amazon.com in all toys and games. It’s also being sold at some other retailers, including Toys ‘R’ Us and smaller stores. You could track sales of the toy before the video launched and after the video launched. The Beastie Boys will argue that those increased sales are due to the video and its association with their song. Goldieblox, however, will point out that not only did they have a successful Kickstarter campaign last year, but in the weeks since the video launched, the holiday season has begun and parents are shopping for gifts for children. These purchases may not be attributable to the video.

Things may get really complex, though, if the Goldieblox video wins the Intuit contest and airs during the Super Bowl. An average 30-second ad spot cost $4 million for the 2013 Super Bowl. Will this count as profit or gain? Most likely. Certainly any resulting sales of the product attributable to the ad would.

Then they’d all have to argue about what proportion of those sales are due to the song, and what proportion are due to the use of the Beastie Boys’ name, and what proportion are due to the cute kids, and what proportion are due to the action in the video, and what proportion are due to the actual toy itself, and what proportion are due to the Goldieblox brand and reputation, and….

…now you know why we can’t have nice things.

How do I make sure this doesn’t happen to me?

That one’s super easy.

Are you making a parody song or using another artist’s work? Contact the artist and ask permission. That’s what Weird Al does (you notice he never covers any Prince songs? Prince never gives permission, and even though he’s pretty safe in the Fair Use Zone, Weird Al prefers to have the original artist’s permission). It’s amazing what you can do with permission.

Can’t get permission? Give some serious thought as to whether or not your idea is worth it. Fair use exists to give new creators the ability to innovate, but if your innovation is so close to someone else’s original work that they feel a need to protect it, you may need to defend your idea. Is it something you feel strongly enough about to defend? If it is, then you might talk to someone who knows fair use to make sure you minimize your risk.

Have you been using another artist’s work and find yourself on the receiving end of legal questions? Politely try to work things out amicably first. The creator of the This Charming Charlie Tumblr received several takedown notices from Universal Music, so she and some other fans reached out to Morrissey. Morrissey issued a statement that he was not represented by Universal, and he supported the Tumblr and hoped it would continue. As I said before, we live in an age of unprecedented access to artists: try asking for permission, even after the fact.

Have things progressed to the stage of legal threats or even legal action? Keep a level head. There’s no sense coming out swinging and then having to take things back.

At this point, most people who read my blog have a pretty good understanding of fair use. We understand the basic principles: we know that a fair use analysis considers four factors, and even commercial uses of a copyrighted work can be fair use, as long as the other factors point to fair use. One particularly protected area is in parody, where an artist is permitted to use of some elements of a prior original work in order to create a new composition that, in some way, comments on that original. Right?

We also know that fair use is one of the hardest, most thorny issues in intellectual property law. In the last few days, a situation has come up that has really done a fine job of illustrating why fair use is such a tricky area, and it points out the biggest thing so many artists forget: it isn’t enough to figure out whether or not a use is fair. The law isn’t all that matters. Let’s start with a little history lesson:

Three MCs and a song about girls

In 1986, the Beastie Boys recorded their (not really) debut album, Licensed to Ill. The album was almost entirely tongue in cheek: a “goof” on the braggadocio of rap music and party rock in which the Beasties depicted themselves as Wild West gunfighters, drunken rock stars, and womanizing louts, and it included a song called “Girls.” In the spirit of the rest of the album, “Girls” was a sexist fantasy about chasing after women (and not getting any), and wanting women to clean the house and hop into bed. Most people never understood that it was meant to be a joke, and the Beastie Boys quickly distanced themselves from the song. They rarely performed the song live, and on subsequent albums the Beasties have rapped about their respect for women.

In legal circles, the Beastie Boys are famous for their support of fair use and other use of copyrighted works — not just lip-service support, but their many legal battles to establish just how much of a work can be used (for instance, see Newton v. Diamond). The Beasties are the last people anyone would expect to be predatory with their copyrighted works.

Goldieblox and a video about girls

On November 18, a really great internet startup called Goldieblox posted a video on YouTube called “GoldieBlox, Rube Goldberg, & Beastie Boys.” The video is a commercial for Goldieblox’s construction toys aimed at little girls, and in the video, girls use the Goldieblox gear to construct an elaborate Rube Goldberg device while singing “Girls”…with new, improved lyrics. Lyrics about how girls’ toys are pink and pretty, and everything else is for boys. Lyrics about how girls can build spaceships and code apps. The video is, let’s face it, awesome.

The backlash begins

A few days later, the Beastie Boys saw the video. They sent Goldieblox a letter explaining that while they liked they video, they didn’t allow their songs to be used in advertising, and they asked why Goldieblox was using “Girls.” Goldieblox immediately (on Nov. 21) went to court and sued, asking for a declaratory judgment: in short, Goldieblox asked the court to rule on whether or not the use was infringing.

And this is why we have such a difficult situation. Goldieblox is probably right in nearly every legal way: the use is fair. The use is a parody. The use doesn’t affect the Beastie Boys’ own ability to license their song, because they would never license it for a commercial anyway (and, for those who might be about to ask, yes, it’s totally okay to make a fair use of another work for commercial purposes). The use does not affect the market for the original song. Goldieblox is, legally, almost certainly in the right.

But that doesn’t mean Goldieblox isright. Oh yes, it followed the law. Goldieblox checked to make sure its use was okay from a fair use perspective. But now what? Now it’s not only in the middle of an expensive lawsuit, it also looks like the bad guy: the company who took a song from beloved musical heroes who’ve tried to honor the final wish of a fallen band member. It’s also in the ugly position of trying to paint the Beastie Boys as copyright bullies: a tactic that worked for about 24 hours, until Beastie Boy Mike Diamond sent an open letter to Goldieblox through the New York Times clarifying that Goldieblox sued them, not the other way around.

So what did Goldieblox do wrong, and what can we learn?

Goldieblox didn’t try asking permission first. If Goldieblox had asked first, it would have learned that Beastie Boys don’t license their music for commercials…and maybe Goldieblox could have created a solution that allowed the awesome viral video to go forward with the blessing and support of the musicians they were parodying, instead of creating a controversy. If not, at least it could have had the discussion and decided whether or not to proceed once it had all the information, assessing not just the legal issues but also the public relations concerns.

We live in a world of unprecedented access to legal information. It’s easy to read an article about how to avoid legal liability, or how to make fair use of content. However, we also live in a world of unprecedented access to content creators (even famous ones), and there’s nothing as safe as a permitted use.

So it’s just like kindergarten: if you want to use somebody’s stuff, ask. Maybe they’ll say yes. Maybe they won’t, and it’ll still be okay to use it anyway, but at least then you can make a fully informed decision. Because in addition to doing the legal thing, we also have to do the right thing.

Edit: Today (Nov. 27), Goldieblox posted an open letter to the Beastie Boys asking if they could all just get along, and removed the song from the video. The lawsuit is still active, but Goldieblox states that it is ready to end it “as long as [they] will no longer be under threat” of an infringement suit. Isn’t it sad to think of how much negativity and bad press could have been spared if they’d just asked first?

Edit again!Newer developments have necessitated a sequel to this post. Go check it out! (I’m not typing out the scratch noises.)